- The SEC may remove the 19b-4 rule-change process to cut crypto ETF approval time to 75 days.
- Eligibility rules for tokens under the faster path remain undefined but could rely on trading metrics.
- The proposal, if adopted, may offer crypto ETF issuers a clearer and faster path to market.
The United States Securities and Exchange Commission is reportedly working with stock exchanges to develop a simplified listing standard for token-based exchange-traded funds. The proposal could remove the need for the traditional 19b-4 rule-change process, which currently adds months to ETF approvals. If adopted, issuers would be allowed to file only an S-1 registration and proceed to listing within 75 days, significantly reducing the timeline.
At present, crypto ETF approvals often involve dual-track filings. Issuers must submit an S-1 form and also seek a rule change under Rule 19b-4. Each stage involves review periods of 45 days or more. This method can result in delays of six to eight months, depending on SEC feedback and objections. Removing the 19b-4 process could allow issuers to bypass one of the key hurdles in the regulatory path.
Listing Criteria for Tokens Still Unclear
The SEC has not yet disclosed the specific requirements a token must meet to qualify for the shortened pathway. However, market analysts suggest that listing eligibility may depend on established standards such as market capitalization, trading volume, and liquidity. This could favor digital assets already listed on major exchanges with robust daily activity.
A more predictable 75-day timeline would benefit companies preparing crypto-based investment products. This change could particularly support asset managers like Bitwise, whose recent Ethereum ETF proposal has faced extended delays. Additionally, removing the rule-change process may offer increased transparency in how crypto ETFs move through the SEC’s review pipeline.
Industry Waits to see Final Outline Confirmed
SEC Chairman Gary Gensler had not officially revealed the new course, and a spokesperson told Fox News when reached that he could not comment. But those who are informed on the matter are alleging that talks with the exchanges are underway.
The change represents possible alterations in the treatment of token-related financial products by the agency and a more disclosure-oriented rather than a regulatory-barriers approach.
